MPs will target unscrupulous bosses for using secret gagging orders to cover up sexual harassment claims in the wake of the Philip Green scandalCredit: AFP or licensors

The contracts silence victims of abusive executives and mean they cannot discover how many others have suffered at the same hands – and sometimes even thwart criminal investigations.

In a new report, the MPs say they uncovered “shocking” evidence that signing gagging orders blights employees’ lives and careers, as they cannot discuss their experiences when going for other jobs or even talk about them with family and close friends.

They call on the Government to place a “mandatory duty” on employers to protect staff from bad behaviour and abuses of power in the workplace, and to allow tribunal judges to impose “punitive damages” on firms as well as making it easier for claimants to recover legal costs.

And they say all bosses should be forced to give staff basic references no matter why they leave.

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Committee chairman Maria Miller said: “It is particularly worrying that secrecy about allegations of unlawful discrimination is being traded for things that employers should be providing as a matter of course, such as references and remedial action to tackle discrimination.

“After signing an NDA, many individuals find it difficult to work in the same sector again. Some suffer emotional and psychological damage as a result of their experiences, which can affect their ability to work and move on. There is also the financial penalty of losing a job and bringing a case against an employer.”